EQT Looks to “Graduate from” (Exit) Huron Shale “Prep School”

Looks like EQT, the largest natural gas-producer in the U.S., is graduating from prep school. That is, EQT is about to sell all of its remaining assets in the Huron Shale play. The Huron is located mainly in West Virginia and Kentucky, also poking up into Ohio and traveling along the edge of Virginia. Most of EQT’s considerable Huron assets (some 12,000 wells) are located in Kentucky. From what we can tell, most of those wells are conventional. That is, not horizontal wells but vertical. The Huron was EQT’s early experiment in shale before shale was “a thing.” EQT played around in the Huron to learn how to drill in shale. According to former CEO Steve Schlotterbeck, “the Huron play was like prep school for us.” Last Thursday EQT filed a Form 8-K with the Securities and Exchange Commission advertising the news they have plans to sell their Huron assets–not only the wells but the pipeline system that connects the wells…
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U.S. Supreme Court Lets Stand Eminent Domain for ME2 Pipeline

It’s been a long, tough fight to get the Mariner East 2 Pipeline (ME2) project built. In fact, it’s still not 100% built (it is about 98% done). Construction on a tiny section near Philadelphia is currently being stopped by a liberal judge (see Antis Get Lib Judge to Shut Down All Mariner East Pipes, Dems Rejoice). We expect that to be resolved soon. However, the project has been sued multiple times in different courts. One of the favored legal arguments was/is to say the project does not have the right to use the power of eminent domain to force recalcitrant landowners from accepting it. One such case, brought by a Lebanon County, PA landowner, was appealed all the way to the U.S. Supreme Court. On Monday the Supremes declined to review the case, a challenge to ME2’s ability to use eminent domain, thereby cementing a ruling by the PA Commonwealth Court that ME2 can indeed use eminent domain. Period. End of sentence. The Supreme Court ruling is just the latest in a string of rulings favoring the ME2 project. Last summer, a three-judge Commonwealth Court panel ruled in favor of ME2, upholding its status as a public utility because it will provide increased public access to energy resources like propane. Huntingdon County Common Pleas Court Judge George Zanic ruled against efforts to delay construction of ME2 after Commonwealth Court validated the utility status by dismissing an appeal. None of this is new. The court have repeatedly ruled against challenges to the state Public Utility Commission’s designation of ME2 as a public utility with  public benefits. And now, the Supremes have rendered the final word: ME2 is a public utility
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Westmoreland Town Votes to Overturn Restrictive Shale Ordinance

Elections have consequences, including local elections. Here’s a story that caught our eye because it’s so unusual (“man bites dog” type of story). Donegal Township in Westmoreland County (southwestern PA) is a rural township: population 2,465 people living in 42 square miles. There was some Marcellus well drilling in the town several years ago, but after WPX plugged wells in the town (see WPX Plugging 9 Wells in Westmoreland County, PA), we find no actively producing wells nor any permits to drill new wells, according to the forthcoming Marcellus & Utica Shale Upstream Almanac 2018 (due out later this week!). Even so, most residents support more Marcellus development. We base that on this observation: A previous town board passed a restrictive zoning ordinance, aimed at blocking shale drilling. Donegal had no zoning ordinance of any kind before the board passed one (last year? year before?). Opponents to the ordinance got themselves elected to the board last November and last Tuesday night voted 4-1 to repeal the zoning ordinance put there by the previous board. According to one of the new board members, tossing out the zoning ordinance “will be helpful to the residents because they’ll have more freedom.” What a breath of fresh air!…
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WV Files Motion to Dismiss EQT Lawsuit Targeting Royalty Law

Earlier this year the West Virginia legislature passed Senate Bill (SB) 360, which Gov. Jim Justice subsequently signed into law (see WV Gov Justice Signs Bill to Guarantee 12.5% Minimum Royalty). The new law overturns a ruling by the WV Supreme Court in Leggett v. EQT Production, a case in which the Supremes (in a very unusual move) reversed their own previous decision and allowed EQT to deduct post-production expenses in old flat rate leases. In essence, SB 360 guarantees rights owners/landowners a 12.5% minimum royalty, regardless of post-production deductions–but only in flat rate leases. A flat rate lease is a lease in which a company pays a regular (in EQT’s case, annual) payment, regardless of how much oil/gas is produced. Traditionally drillers don’t deduct post-production expenses because the payments landowners get are piddly anyway. But then EQT began to claim deductions, prompting a lawsuit that went all the way to the Supreme Court. The legislature aimed to “fix” what they considered an error in the court’s ruling. EQT claims the new law is unconstitutional and in April filed a lawsuit asking a judge to stop the law from taking effect (see EQT Sues WV for Passing Minimum Royalty Law re Flat Rate Leases). WV has just responded, in a big way, by asking the judge to dismiss EQT’s lawsuit…
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Quaker “Friends” Turn Unfriendly re Pipelines, Support Illegal Action

Who knew that Quakers, formally known as the “Religious Society of Friends” or “Friends Church,” could be so, well, unfriendly? Turns out the Quakers, who at first blush you might think are conservative, like the Amish, are far-left liberals. At a recent meeting of the Roanoke Friends, the Quakers adopted a statement (below) to “speak out against two natural gas pipelines [Mountain Valley Pipeline and Atlantic Coast Pipeline] proposed in Virginia, and all pipelines transporting gas extracted by hydraulic fracking. Fracking is a process documented to contaminate air and water with toxic chemicals, accelerating climate change and encouraging our dependence on fossil fuels.” Sorry my Quaker friends, but you just out-and-out lied. Fracking is not documented to contaminate air and water with toxic chemicals. Period. If you have real scientific evidence to the contrary, please produce it. If we take them at their word, the “friendly” Quakers want all pipelines that flow natural gas everywhere–including the ones that feed their own homes (!)–to be shut down. All pipelines, including local utility pipelines that feed the homes of millions of Americans, flow “fracked” gas. Most gas these days is “fracked.” The “friendly” Quakers also state their support of illegal, law-breaking protesters who sit in trees against a judge’s order, to stop work on pipelines. The Quaker Friends in Roanoke have shown themselves to be just one more non-thinking, knee-jerk reacting group of liberals who really don’t know what they’re talking about…
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All MVP Tree-Sitting Protesters have Now Dropped Back to Earth

We’re happy to report that “Fern” and “Decard” have joined “Ink,” “Sprout,” “Red” and “Nutty” back here on Mother Earth. No, we’re not talking about a new Disney “Snow White” remake (Sneezy, Sleepy, Dopey, et al). The names we listed are the names of so-called protesters who have been sitting in the tops of trees (or in the case of Fern and Nutty, on top of poles) in Virginia, part of an illegal action to prevent the construction of the Mountain Valley Pipeline. These last two protesters, Fern and Decard, were recently forced down to earth and arrested. Pipeline construction through the areas they once occupied has resumed. Which is good news. This bunch of kooks were making a mockery of our justice system. Nutty was a woman who sat on top of a pole for nearly two months. Yeah, her self-selected nom de guerre was appropriate. She finally came down two weeks ago when she ran out of Snickers bars (see MVP “Nutty” Protester Drops Back to Earth – Out of Food). But around that same time, another woman, Fern, went up a pole about a mile up the road from Nutty (see “Nutty” is as Nutty Does – 2nd MVP Protester Goes Up a Pole in VA). Fern only last a couple of weeks–not nearly as long as her “hero” Nutty. We’re just happy to say that all of the nuts have now dropped to earth and we can put this sad chapter behind us…
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Trump Makes Rare Wrong Move – Protects Coal & Nuke Plants

We admire President Trump and the job he’s doing–and aren’t afraid to say so publicly. However, we don’t always agree with his decisions and policies. This is one of those times. In fact, we strongly disagree with a new Trump policy. President Trump has decided that the nation’s electricity grid, in order to be “secure” and not vulnerable to outages, needs to have a diversity of sources producing electricity. Even if those sources (coal and nuclear) are no longer economic. Natural gas, and to a far less degree, renewables like wind and solar, are replacing both coal and nuclear power plants. The gas is abundant, it’s cheap, it burns clean and just makes sense. Yet powerful lobbying interests for coal and nuclear have convinced Trump that without their higher-priced electricity in the mix, the country is somehow threatened. That’s bunkum. Last Friday, President Trump ordered Dept. of Energy Secretary Rick Perry to “prepare immediate steps” to stop the coal and nuke plants from retiring. That is unfortunate. Obama picked energy winners and losers. Fossil fuels like coal were targeted for extinction by Obama. Now, Trump is doing the same thing but in reverse. By propping up coal and nuclear, he will make electricity far more expensive for everyone. The right answer here, as it always has been, is to let the free market work…
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Energy Stories of Interest: Tue, Jun 5, 2018

The “best of the rest”–stories that caught MDN’s eye that you may be interested in reading: Dem FERC Commissioners keep voting against pipelines re global warming; whatever happened to Dakota Access Pipeline?; Williams appoints new independent board member; Cali judge extols the virtues of fossil fuels; 15 states ask judge to dismiss “climate” lawsuit; the path to American energy independence – shale; U.S. natgas markets now tied to LNG exports; Poland wants to buy into American LNG exports; India begins importing Russian LNG; Japan’s Isuzu tests LNG truck; and more!
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